MG Rover's Phoenix Four

The last domestically owned mass-production car manufacturer in the British Motor Industry MG was formed when BMW sold Rover group to the Phoenix Consortium in 2000.

Just five years later and MG sadly went into administration, key assets were purchased by Nanjing Automobile group and then in 2007 MG sports cars and sports salons were restarted. Then the game of pass the parcel began! The Rover brand, retained by BMW and licensed to MG Rover was then sold onto Ford. However Ford had also bought Land Rover from BMW in 2000 and then in 2008 Tata motors bought Jaguar Land Rover business and the Rover brand off ford.

But where did it all go wrong?

Five years ago, four businessmen bought MG Rover and everyone hailed them as heroes for saving the firm from becoming extinct but with the firm collapsing they have been condemned after a number of failed promises that they could put life back into MG Rover.

Having been left a £1bn dowry by BMW, the Phoenix four as they are now known were supposed to use this to revive the firm however they had other thoughts and burned through the billion rewarding themselves, £40m in pension, pay and other various benefits.

Then when the cash ran out, 5000 workers lost their jobs, and the four were slated by fellow staff, managers, suppliers and many others stating that they had a lot to answer for.

In charge at Longbridge the whole story unfolded of manipulated assets and income streams through using companies in which the directors had an interest in rather than the creditors of MG Rover. This meant that the large salaries of estimated £40m that they benefitted from has landed them in trouble as government have as a result banned Peter Beale from acting in the management of companies for six years; John Towers and Nick Stephenson for five years; and John Edwards for three years for their involvement.

This stands as a warning that unacceptable conduct by any company directors can result in lengthy periods of disqualification.

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10th May 2011, 13:45